Delcath Systems (DCTH), a developer of treatments for metastatic liver cancers, misstated its financials in three of four quarters in 2022. While auditing its year end financial statements, Delcath says it discovered it had understated stock based compensation (SBC) expense.

Rather than prominently highlight how the misstatements resulted in the company’s net loss being understated, Delcath emphasized that SBC is a non-cash item and that the mistake had no impact to the cash balance.

Though Delcath acknowledges the misstatements were made in each of the year’s first three quarters, we found a revised Consolidated Statement of Operations only for the quarter ended March 31, 2022 which revealed:

—Net loss was understated by $797k, or 8.85%

The incomplete revision, we suspect, is due to the magnitude of the understatement.

In total, Delcath understated its net loss during the first nine months of 2022 by $1.7 million, or 16.6%, according to our analysis.

Delcath did not provide investors a reason why it corrected only one quarter’s net loss calculation.

The quarterly report revealing the understated net loss was filed late. Delcath told the SEC it needed more time valuing warrants preferred stock it had issued.

Separately, Delcath’s recent $17 million At-the-Market (ATM) share offering is approximately 21.7% of the company’s market capitalization. As of this writing the company has sold approximately $4 million.

Delcath shares are up more than 100% year-to-date.